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TAX TALK

TAX TALK

Author: Natalie Wocke
Date: 2014-05-09
SMALL BUSINESS CORPORATION TAX INCENTIVE - WHY PAY 28%

Do you qualify for these reduced tax rates? For years of assessment ended 01 April 2014 to 31 March 2015.

Taxable income tax rate
  • 0 to R 70,700 0%
  • R 70,001 to R365, 000 7% of the amount exceeding R70, 700
  • R365, 001 to R550, 000 R20, 601 + 21% of the amount exceeding R365, 000
  • In excess of R550, 000 R59, 451 + 28% of the amount exceeding R550, 000

There is an excellent tax incentive available to Small Business Corporations which many qualifying businesses are not taking advantage of, when in fact they do qualify.

Many existing businesses, trading as corporations could also qualify with safe and sensible planning.

If you are looking at setting up a new business, or buying an existing one, you should consider obtaining advice from a tax and accounting professional regarding the best vehicle for your business.

This assessment should take into account all relevant factors, some of which to consider are: Your business risk, cost of compliance, the regulatory framework applicable to your business vehicle, estate and tax planning, asset protection, cash flow factors relating to vat registration, and many more.

Once the above factors have been considered, and you have decided that incorporation will be the best possible option for you, or if you are already trading as a Close Corporation or Company, you need to determine if your business will qualify for/can be structured to ensure it does in fact qualify for the "Small Business Corporation" (SBC) incentive.

For more information read on in nest week's edition of The Bugle or contact Roberts & Chaplin on 031 586 0387